In re Methyl Tertiary Butyl Ether (“MTBE”) Prods. Liab. Litig., Master File No. 1:00–1898.

67 F.Supp.3d 619

In re METHYL TERTIARY BUTYL ETHER (“MTBE”) PRODUCTS LIABILITY LITIGATION.

Master File No. 1:00–1898.

MDL No. 1358 SAS.

No. M21–88.

United States District Court, S.D. New York.

Signed Dec. 18, 2014.

William A. Walsh, Esq., Weitz & Luxenberg, P.C., New York, NY, for Plaintiffs.

Michael D. Axline, Esq., Tracey L. O'Reilly, Esq., Miller, Axline, & Sawyer, Sacramento, CA, for the District.

James A. Pardo, Esq., Lisa A. Gerson, Esq., McDermott Will & Emery LLP, New York, NY, for Defendants.

Richard E. Wallace, Jr., Esq., Peter C. Condron, Esq., Amanda Gilbert, Esq., Sedgewick LLP, Washington, D.C., for Trial Sites Defendants.

Jeffrey J. Parker, Esq., Whitney J. Roy, Esq., Sheppard, Mullin, Richter & Hampton LLP, Los Angeles, CA, Jon D. Anderson, Esq., Latham & Watkins LLP, Costa Mesa, CA, for Omnibus Defendants.

OPINION AND ORDER

SHIRA A. SCHEINDLIN, District Judge:

I. INTRODUCTION

This is a consolidated multi-district litigation (“MDL”) relating to contamination—actual or threatened—of groundwater from various defendants' use of the gasoline additive methyl tertiary butyl ether (“MTBE”) and/or tertiary butyl alcohol, a product formed by the breakdown of MTBE in water. In this case, plaintiff Orange County Water District (the “District”), which is charged with maintaining groundwater quality, alleges that defendants' use and handling of MTBE has contaminated, or threatened to contaminate groundwater within its jurisdiction. Familiarity with the underlying facts is presumed for the purposes of this Order.¹

Currently before the Court are two motions: (1) a motion for summary judgment brought by all defendants in this action on various grounds (the “Omnibus Motion”),² and (2) a motion for partial summary judgment brought by certain defendants on claims brought by the District at four designated focus trial sites, alleging that the District suffered no compensable injury or cognizable damages at those trial sites (the “Trial Sites Motion”).³ For the reasons stated below, defendants' Omnibus Motion is GRANTED in part and DENIED in part. Defendants' Trial Sites Motion is DENIED.

II. BACKGROUND⁴

The history of this now ten year old lawsuit is contained within the hundreds of pages worth of prior opinions I have already issued in this case. Once again, I provide a very brief overview. The crux of the District's lawsuit is that releases of MTBE, contained in defendants' gasoline, have reached, or will reach, water production wells, contaminating Orange County's water supply. For the past decade, defendants have chipped away at the District's case through various stipulations and favorable summary judgment rulings.⁵ The District's own attempts to prevail on its claims before trial have been less successful.⁶ What remains are the District's timely claims for nuisance, negligence, strict liability, violations of the Orange County Water District Act (“OCWD Act”), and declaratory relief against various defendants at thirty-one focus stations, each of which are associated with certain focus plumes.⁷ In this section, I describe the specific grounds of defendants' motions and provide an overview of the facts relevant to resolving those motions.

A. The Pending Motions

In the Omnibus Motion, various groups of defendants have moved for summary judgment on eight grounds:⁸ (1) lack of affirmative conduct by defendants which is necessary in order to prevail on a claim for nuisance, (2) lack of evidence of reasonable abatability by plaintiff which is necessary in order to prevail on a claim for continuing nuisance, (3) lack of affirmative conduct by defendants which is necessary in order to prevail on a claim under the OCWD Act, (4) lack of evidence of any recoverable costs incurred by plaintiff which is necessary in order to prevail under the OCWD Act, (5) lack of evidence tracing defendants' gasoline to the stations at issue, (6) lack of evidence tracing particular defendants' gasoline from the stations at issue to the production wells, (7) claims at certain stations are time-barred, and (8) failure to disclose information in discovery.⁹ In the Trial Sites Motion, defendants move for partial summary judgment at four focus stations where defendants claim that the District cannot establish any compensable injury.¹⁰

In opposition to both the Omnibus Motion and the Trial Sites Motion, the District relies heavily on declarations by its fate-and-transport expert, Dr. Stephen Wheatcraft.¹¹ On September 22, 2014, I denied defendants' motion to strike Dr. Wheatcraft's first declaration, rejecting their argument that the declaration constituted a “sham affidavit” because of alleged contradictions between it and his prior deposition testimony.¹² Following an October 6, 2014 teleconference, during which the parties debated the merits of Dr. Wheatcraft's fate-and-transport modeling,¹³ the District submitted, at the Court's request, a supplemental declaration of Dr. Wheatcraft explaining in further detail how his model traced gasoline from the individual stations to production wells.¹⁴ With the Court's permission, defendants filed a response in opposition to this supplemental declaration, including a declaration by their own expert,¹⁵ and the District filed a final supplemental declaration of Dr. Wheatcraft replying to defendants' opposition.¹⁶

B. Dr. Wheatcraft's Fate–and–Transport Model

At the heart of both summary judgment motions is the disputed testimony of Dr. Wheatcraft, who purports to trace MTBE releases from individual stations to production wells by modeling the path of MTBE plumes. To explain how the model works, it is helpful first to state what Dr. Wheatcraft does not do: trace specific MTBE releases from their precise, station-specific release point to the associated production well.¹⁷ While Dr. Wheatcraft did conduct station-specific models to trace MTBE in other regions of California, he claims that in Orange County, a station-specific model “was not possible” for most of the stations “due to clustering.”¹⁸ In essence, Dr. Wheatcraft argues that where there are many individual stations in close proximity, as there allegedly are in Orange County, it is “nearly impossible” to attribute MTBE detections to a single station.¹⁹ Accordingly, a corresponding station-specific model would be inaccurate because the “mass of MTBE would be knowingly understated.”²⁰

To compensate for this perceived problem, Dr. Wheatcraft groups individual stations into “focus plumes.” The plumes are essentially MTBE masses formed by releases from nearby individual stations; Dr. Wheatcraft's model charts the migration of the plumes to production wells.²¹ He states that a “separate MTBE source term for each of the focus plume stations was added to the model at the location of the station.”²² Therefore, though Dr. Wheatcraft is tracing the path of “plumes,” not individual station-specific releases, the data driving the model is information regarding releases “from each individual focus plume station.”²³ Ultimately, Dr. Wheatcraft insists that his model “shows, and it is [his] opinion, that MTBE from each station will enter a plume, comingle [sic] with MTBE from other stations, and then impact one or more wells.”²⁴

Defendants and their expert disagree with Dr. Wheatcraft's conclusion, as well as the alleged flaws of a station-specific model.²⁵ Instead, defendants argue that “[c]ommingling of plumes in an aquifer does not mean that all the contamination from different sources will behave the same way in groundwater or will necessarily be transported to the same receptor (e.g., a supply well), or that the ‘commingled portion’ of the plumes will travel to a supply well.”²⁶ Therefore, in order “to determine whether it is more likely than not that the contamination from one source in an overlapping or commingled plume impacts a supply well or other reference point one needs to determine whether a pathway exists between that source and the well.”²⁷

C. Defendants' Conduct in Orange County

In this section, I outline the facts relevant to each of the grounds in the Omnibus Motion. Unless otherwise indicated, these facts are undisputed.

1. Issue 1 Defendants

The Issue 1 defendants move for summary judgment based on the District's alleged lack of evidence to support the type of affirmative conduct necessary to establish a nuisance claim at the corresponding stations. These defendants did not own the stations at issue.²⁸ Some of the Issue 1 defendants entered into supply contracts and branding agreements with the stations at issue.²⁹ For instance, World Oil had an agreement with Exxon to brand World Oil's station “Exxon” and sell Exxon-branded gasoline.³⁰ Similarly, Chevron USA did not own the station G & M # 4, but it did supply the station with gasoline.³¹ However, the stations themselves, not the defendants associated with the stations, were responsible for providing station employees with training on the handling and storage of gasoline and the clean-up of spills and leaks.³² The District contends that the Issue 1 defendants provided “inadequate” instructions regarding the handling, storage, and clean-up.³³

2. Issue 2 Defendants

The Issue 2 defendants move for summary judgment on the ground that the District lacks evidence of reasonable abatability to state a claim for continuing nuisance. In response to this contention, the District relies, rather vaguely, on a combination of expert reports claiming that the MTBE contamination in Orange County can and must be abated.³⁴ Also relevant to the inquiry of abatability is a determination regarding whether the contaminants at issue are continuing to migrate towards production wells. The facts underlying this question are summarized above in the description of Dr. Wheatcraft's fate-and-transport model.

3. Issue 3 Defendants

The Issue 3 defendants move for summary judgment based on the District's alleged lack of evidence to support the type of affirmative conduct necessary to establish an OCWD Act claim at the corresponding stations....